When PAE increases, we expect that the economy will be at _______ levels of equilibrium GDP.
A) lower
B) higher
C) constant
D) cycling

Name: When PAE increases, we expect that the economy will be at _______ levels of equilibrium GDP. A) lower B) higher C) constant D) cycling
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Question

Quizplus · Accepted Answer

As PAE (planned aggregate expenditure) increases, it leads to an increase in aggregate demand. This increase in demand results in higher levels of equilibrium GDP, as producers increase their output to meet the heightened demand.

When PAE Increases, We Expect That the Economy Will Be